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Monetizing Strategies for Smart Cities

Is your city smart? There seems to be many ways to determine if a city is smart. However, as I see it, a smart city is truly compelling when citizens experience a sharp reduction in crime rates, a decline in energy consumption, a decrease in traffic congestion, and an overall improvement in water usage. In addition, the smartest cities understand how to tap into more ways to take advantage of eco-friendly building materials and leverage innovations all tied to data that perhaps ultimately generate revenue for local governments. With that being said, we’ve been talking about smart cities for years and I have yet to see us reach the pinnacle where smarter cities are “selling themselves.”

In my experience, we still have more to do before we can actually claim true success just yet. A lot of vendors are saying they are still having to help cities come up with compelling use cases and monetization strategies for the IoT (Internet of Things).

Gartner, www.gartner.com, Stamford, Conn., predicts 50% of citizens in large cities will share personal data with smart-city programs by 2019. Additionally, 20% of all local government organizations will generate revenue through open data by 2020.

Of course, funding is always an issue when it comes to investing in the total infrastructure—whether it’s physical infrastructure or technology infrastructure for smart- city applications.

So, perhaps in the spirit of CES, since I was just in Las Vegas for the conference, perhaps it’s apropos to delve into how the city of Las Vegas is moving forward with this technology in 2017. The city of Las Vegas has announced it’s enabling various smart-city applications in its Las Vegas Innovation District.

The Innovation District, which is next door to the Las Vegas strip, will serve as a sort of test bed for IoT innovations that will eventually be deployed across the rest of the city. Currently, a lot of people live in the greater Las Vegas area, and even more people visit Las Vegas each year, approximately, more than 40 million people.

The director of information technologies for the city of Las Vegas says the city is an ideal location to deploy next-gen IoT applications. I can’t help but agree with this assessment, especially considering the city’s technology partner.

The first application that will be deployed via the Innovation District program will be an environmental monitoring application, and this will lead to deployments of other data-driven smart city solutions throughout 2017 and beyond. The city is partnering with Ingenu, www.ingenu.com, to collect data from devices that can provide city officials with insight into parking, air quality, and other environmental factors, pedestrian traffic, and more. The ultimate goal is to drive operational efficiencies, to expand city services, and to enhance city resources.

I’d really like to see this sort of idea—an innovation district—take hold in other cities. What it’s doing in Las Vegas is giving the city a chance to experiment and really start to figure out what IoT use cases make sense for its citizens and its particular location.

This is just one example. But there are many ways to really look at the role of smart cities and what we can expect to see more emphasis on in 2017. For instance, smart airports. Here are some quick stats to show what the analysts are also anticipating in the coming year.

One technology research company, Technavio, says the global smart-airport market will reach $13 billion by 2019. That’s a compound annual growth rate of about 6%. Another prediction from global industry analysts says the global market for smart airports in terms of annual spending will exceed $15 billion by 2020.

The two predictions support each other, and both suggest respectable growth is ahead for the space. However, when I started looking more closely at the market for smart-airport technologies, I was surprised to find that most growth seems to be happening beyond U.S. soil.

I think it’s an oversight for U.S. cities to ignore the possibilities for improved workflow and creating a better patron experience at airports. Think about it, every visitor’s first impression of a city comes from its airport—whether it’s Los Angeles Intl., La Guardia Airport, O’Hare Intl., or McCarran Intl.

Just like any other large commercial or enterprise building, there are opportunities here to leverage IoT technology to cut back on energy use and better manage heating, cooling, and lighting systems. In an airport especially, the ability to monitor foot traffic and congestion, respond to incidents and disruptions, and provide realtime data to people in the airport is really important.

For instance, according to MarketResearch.com by deploying IoT solutions, airport managers can increase operational efficiency through on-demand resource deployment, better capacity planning, and service delivery automation. There’s also the chance to improve travelers’ experiences through self-service facilities. To take it even further, smart airports would also lend themselves to opportunities for location-based mobile advertising to people’s devices.

Down the road, it would be interesting to see automated gates and border control services, robots handling luggage, and better, smarter passenger services at airports in general. So, in addition to making traffic and parking, streetlights, utilities, and buildings smart, let’s make our airports smart too.

These are critical hubs of city life. The city of Las Vegas is taking a bold step by establishing a concrete plan to test IoT applications and learn what works via its Innovation District. The good news is that many more cities have an opportunity to learn and provide a better experience for all its citizens by leveraging the IoT at its best, at least for now.